Gulf markets seen shaky after Iran oil ban

Dubai, January 24, 2012

Gulf markets are expected to be shaky after European Union agreed to ban Iran oil and new threats from the producer to block the Strait of Hormuz.

Some Iranians also warned they might strike US targets worldwide if Washington used force to break any Iranian blockade of the strategically vital shipping route.

Front-month Brent crude rose 12 cents to $110.70 a barrel, gaining for a second day.

"While you might get some knee-jerk reaction in the short-term, you have to watch out for the sustained impact on energy prices," says Abdul Kadir Hussain, chief executive and fund manager at Mashreq Capital.

"At this point, people are still thinking that it will not get heated to the point of oil supply disruption. There will be geopolitical premium but hopefully that would dissipate over the next few weeks," he adds.

Delays in Greece debt restructuring could also weigh on sentiment after Euro zone finance ministers on Monday rejected help offer made by private bondholders, sending negotiators back to the drawing board.

The euro retreated from a three-week high on Tuesday while Asian shares edged higher.

National Bank of Oman will be in focus after the lender's fourth-quarter results missed analysts’ forecasts.

The bank proposed a cash dividend of 17.5 percent.

Oman's two Islamic banks will float 40 percent of their shares by June, the sultanate's central bank Executive President Hamood Sangour al-Zadjali said on Monday.

Bank Nizwa will issue an initial public offering of 40 percent of its capital of OR150 million ($389.61 million), while Al Izz International Bank will issue 40 percent of its OR100 million capital by June this year. – Reuters